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BBSI or ADP: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Outsourcing sector might want to consider either Barrett Business Services (BBSI - Free Report) or Automatic Data Processing (ADP - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Barrett Business Services and Automatic Data Processing have a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one piece of the puzzle for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
BBSI currently has a forward P/E ratio of 12.23, while ADP has a forward P/E of 32.23. We also note that BBSI has a PEG ratio of 0.82. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ADP currently has a PEG ratio of 2.69.
Another notable valuation metric for BBSI is its P/B ratio of 2.93. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, ADP has a P/B of 22.38.
These metrics, and several others, help BBSI earn a Value grade of B, while ADP has been given a Value grade of D.
Both BBSI and ADP are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that BBSI is the superior value option right now.
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BBSI or ADP: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Outsourcing sector might want to consider either Barrett Business Services (BBSI - Free Report) or Automatic Data Processing (ADP - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Barrett Business Services and Automatic Data Processing have a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one piece of the puzzle for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
BBSI currently has a forward P/E ratio of 12.23, while ADP has a forward P/E of 32.23. We also note that BBSI has a PEG ratio of 0.82. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ADP currently has a PEG ratio of 2.69.
Another notable valuation metric for BBSI is its P/B ratio of 2.93. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, ADP has a P/B of 22.38.
These metrics, and several others, help BBSI earn a Value grade of B, while ADP has been given a Value grade of D.
Both BBSI and ADP are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that BBSI is the superior value option right now.